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- [00:00]
A
Podcast nation. Before I get you into today's podcast, big announcement. As you probably heard at this point, because I had John from Stan on the show, I am an investor advisor to an incredible startup called Stan. Stan Store. I'm sending you right now to GaryVee.com, garyVee.com Stan, go check this out. We've done a GaryVee Stan store challenge, which actually has a weekly call with me. This is built for everyone who's been affected honestly by my overall content. The tech stack, all these features, and the minimal costs per month that Stan Store has built is really the tool that was needed for this world that I envisioned when I wrote Crush it, when I wrote Crushing It. And this overall thing I'm thinking a lot about lately, which is the individual empire, right? This creator entrepreneur slash entrepreneur creator economy that I think is gonna eat up the oxygen. Very honestly. The thing that so many of you want in your life and the reason so many of you are not there yet is, is you've got the strategy for me. You've got the ambition within yourself, but you don't have the tools for you to fully maximize it. And I believe you can find that at Stan Store. Stan Store. But specifically, I want you to sign up for it through my challenge because I want to get access with you. And plus, there's a bunch of cool things. So if you want to go see those cool things, go to garyvee.com Stan S T A N Now to the podcast. This is the GaryVee audio experience. VaynerNation. How are you? Another exciting episode of the GaryVee audio experience. Decided that we've done a lot of motivation, we're doing a lot of innovation, but I want to get into operation. I want to get into the depths. I was really excited when the opportunity came to have this guest on the show because I think bringing leaders who actually did it are actually doing it are building, you know, for me, building, building a business that from afar, I admire in its longevity. It's not a fly by night. It's not a quote unquote unicorn, even though this is probably a unicorn in the way. But it's defied. But like, you know, like it's. It's not. It's a unicorn, AKA startup that's a big company, not a rhinoceros with a unicorn with painting its horn and making pretend it's a unicorn, AKA a lot of the startups that are grossly overvalued and then disappear off the face of the earth because they were over Leveraged and, and weren't actually building an actual business. And I wanna tap into some of the minds of the people that are doing it. Cause so many of you are on your journey of doing it. And so that's why I asked Henry to be on the show. Henry, welcome. Please tell everybody your full name, what you do, what the company is, and a little bit about the company. And I think we should get into a meat and potatoes episode here of the audio experience. Thank you for being on, brother.
- [02:48]
B
Yeah, thanks, Gary. Thanks for having me. Yeah. My name's Henry Ward. I'm the co founder, CEO at Carta. You know, we do, we're about 10 years old. We do, we have three lines of business. We're about 350 million in revenue. But 60% of that comes out of our core cap table business, which, where we serve startups and manage their cap tables. Another 30% comes out of our fund administration business where we manage the back office of venture funds and do their financial accounting and reporting to their investors, their LPs. And then we have a newer business which is about 10% of the business now, it's a couple years old. And it's our private equity business where we're basically managing the cap tables and fund administration, private equity companies and funds.
- [03:34]
A
How did it start?
- [03:36]
B
You know, we saw this cap table problem. It was sort of interesting. People in 2013, 14, when we launched, were physically mailing paper stock certificates. Like if you see the old movies with the. Yeah, with the railroads. Brother, look at this, you've got four in your room. Yeah.
- [03:55]
A
Facebook, Twitter and Tumblr.
- [03:57]
B
Beautiful. Beautiful. All Pre Carta Fall 2006.
- [04:02]
A
7.
- [04:03]
B
Nice. Nice. Really nice.
- [04:05]
A
Know what the valuations of those companies was back then?
- [04:08]
B
Totally, Totally. And they're beautiful. They're embroidered. You know, they look exactly like the stock certificates when they invested in the railroads. And we're still doing that in 2013. And we said, hey, can we do something like what PayPal did for cash? You know, can we dematerialize these stocks? Or to Vegas instead of sending paper, instead of paying, you know, mailing a check or mailing cash, could we send equity through email the way PayPal sends money through email? Can we do that through the cloud? And that was the original idea. Could we push all this stuff in the cloud? And then once you did that, once you dematerialized equity and put it in the cloud, suddenly the option value on that exploded. There's so many things we could do. We could do cap table management, we could do option management. We could do portfolio management, we could do liquidity. We could do fund administration. It took off. We created an entire ecosystem. Once you got things out of paper.
- [05:08]
A
How quickly did you know. This is a great question for the audience. How quickly did you know we got something here?
- [05:17]
B
You know, we were in beta. I think we kind of launched a free version of this product maybe in July of 2013.
- [05:25]
A
I'm sorry to interrupt. I remember it vividly. I was so pumped it existed.
- [05:29]
B
That's awesome.
- [05:30]
A
The concept that I was able to just forward it to somebody and be like, take care of this. And, like, the thing I needed to be done when I was making an investment was done. It was massive for me. Someone like me that cares about time over everything, like, it was huge. I remember those early days. Like, I was like. I remember thinking, like, this just changed my life totally.
- [05:48]
B
Totally. Well, thank you for being an early user. It was a tough start. Like, a lot of these companies where you're doing something completely new. Nobody had bought Cap table software before 2014. It just didn't exist. There's companies where you're building something that already exists. Like. Like MongoDB is like my favorite example, right? People had databases. MongoDB was like, I'm building a better database. And you didn't have to convince people to buy a database. You just had to convince people to buy a better database. And Cap Tables was different. Nobody ever in the history of the world had ever bought a Cap Table software product before. And so you had to convince people to buy something that they never bought before and they never thought they needed. And so it was hard to get going. You know, it's hard to convince people to do something they've never done. And we launched kind of an early beta in July 2013 that barely worked. And then we started charging in January of 2014. That's when we're like, okay. And we earned our first $120 on January 7th from a friend and company startup in Austin, Texas. And it was amazing. It was incredible. The first time you build something as an entrepreneur that somebody pays you for is a magical moment. I'll never forget it.
- [06:58]
A
Really? You know what? That's a great call out. I genuinely remember, like, the first Gillette deal with Vervainer Media. AJ Was still in college. I vividly remember kind of the first things I sold at my dad's liquor store when I was 15. Kenwood 1992. 1990 Chardonnay. Like, literally, I can sit here and tell you. Kenwood 1990 Chardonnay from Sonoma Valley is, like, ingrained in my heart. This goes a little bit to why I want this episode. Henry, I view you from afar, and we're getting to know each other a little bit here as a. Like, an actual entrepreneur. And what I mean by that is it's in when you, like, love the game, not the thing that has become, which is, like, it's so cool. Like, quote unquote. Everyone is, you know, like, I love playing sports, but I'm not a professional athlete. When you love the game, like, you can, like. I don't think a lot of people can actually talk about the first thing they sold, the modern entrepreneur, right? Like, yeah, they can remember when they raised the capital. They can remember this, that, and the other thing, but, like, the actual first client, especially if they're five, seven years in. In this new era. But I can remember the first wine I sold for my dad, the first client. VaynerMedia had, like, all of it, like, vividly.
- [08:17]
B
Totally. Totally. It's. It's amazing. I remember we made $800 in January of 2014, and it was the most amazing 800 DOL. You know, we made this year. We'll put $100 million of bookings on the board. Right? But. And the thing is, is even at, you know, 2,000 employees, you know, 350 million in revenue going to 450, I spent, you know, half my day. I talked to four customers yesterday that were unhappy. And that's what you do. That's no different than when you're a seed founder. Like, you're just. You love the game. You love talking to customers, facing problems, building products.
- [08:51]
A
Look, right now, back to your point. 3. Am I right about this 3:45pm today client issue? I have 2,000 employees. How many employees you got?
- [09:02]
B
About 2,000 also.
- [09:04]
A
Yeah, there you go. Right?
- [09:06]
B
Yep.
- [09:06]
A
It's amazing. Keep going.
- [09:08]
B
Yeah. No, and. And. And, you know, so. So, you know, at January, we made 800 bucks. We're like, okay, well, at least somebody will pay us for this. So that. That was amazing. So that was, I guess, Milestone. 1. Somebody paid us for something we built, which was. Which is a super huge high. And then I would say that the second one was August of that year. And we moved our, you know, back then, you still called, you know, to order something, you know, and so we had a phone system, and it was one of these things. You called in and you pressed, you know, one to talk to sales, two to talk to, you know, support, and we changed our phone system and broke something so that when you clicked one and it went to sales. It hung up on you. The classic startup story. We had no idea what we're doing, so it just hung up on you. If you tried to talk to a salesperson. And we sold more in August than we did any month prior. And we didn't even know until halfway through the month. Somebody went in through support and was like, hey guys, I'm trying to give you money to buy your software and I can't get to anybody. You know, what is going on over there? And I was like, oh, we have something. People are beating down the doors to get this product. And I would say the third one was we finally had so many sales orders we couldn't onboard them fast enough. And this was in January of 2014, a year later, or sorry, December of 2014 and we're going into Christmas. And I told the sales team, all five or six of them at the time, I said, you have to stop selling. You're not allowed to sell. I'm going to put you on a draw for, for three months and all of you are going to be onboarding managers and we're going to close the doors because our customers are furious because they bought, but we can't deliver.
- [10:53]
A
Yeah.
- [10:53]
B
Because we're selling too much. And that was, that was the moment.
- [10:57]
A
Yeah. Do you think that that is an incredible common mistake of successful? Like, obviously a lot of people end up figuring it out. Like, actually, I think the story you just told, if you even have the talent and the product market fit to get to that problem, you 7.5 out of 10 times know what to do in that moment to get to the next place. Sometimes technology's not there. You might remember Friendster because you're a tech dude. You know, like Friendster being down all the time really eliminated it from having the opportunity of becoming MySpace or Facebook. Right. I mean, Twitter got lucky a little bit because there was no unique competitor. There was Pounce, if you remember that pop for a while. But I mean, Twitter was a real problem in 2006. Seven, eight, just wasn't up. Then there's the other thing, like under delivering on what you sold. Big issue for me in a client service business because I'm completely human based. You have a smart business, I have a stupid business. If I wasn't building something bigger on top of it. And so I think, I think for us it's very hard when you're scaling people. As you can imagine with technology or product, it's a lot, quote unquote easier when you get your supply chain or your tech team down, but you find that to be a common problem. And then more importantly for the people that are in it right now, that problem, like you've over promised and underdelivered, do you recommend they take your track, which is a drastic tack, or do you feel like they should do things that have worked for me in the past, which was more of a, okay, fuck it, I'm just gonna hold my breath and fly the, keep flying the plane, but fix it while I'm flying the plane and make sure that doesn't get out of whack.
- [12:34]
B
Both.
- [12:34]
A
What's your thoughts on that?
- [12:36]
B
Yeah, well, so we did this, you know, we didn't really have marketing back then, so our version of marketing was me and my assistant and, or chief of staff I think. And I asked my chief of staff, I said, hey, go talk to 50 customers and interview them and ask them how they heard about Carta, why they decided to buy Carta and what that sales cycle was like. And all of them kind of heard a little bit different. Somebody came in from a friend, an investor, Google search, whatever it was. But the one thing that was 100% consistent, 50 of 50 customers asked somebody else who was a Carta user what they had heard of Carta to decide whether to buy. And so we knew that the most important thing we could get right is that when that phone call happened, the person who did have experience with Carta would say a good thing. That was like the number one thing, nothing else mattered. And so I said, it doesn't matter. We have to make sure that the reference checks go well. And if people aren't happy, it kills everything. And I'm willing to take a three month closing the doors on sales to make sure that's always true. And it was a tough decision, right, you know, to tell the board, hey, I'm not going to sell for three months. That's a tough, tough conversation to have.
- [13:54]
A
Segue back to like me wanting it to be a meat and potatoes table. Talk to me about the pros and cons, not just from your perspective, because you have yours and obviously there's been a lot of success. Congratulations. So I have a funny feeling people are feeling pretty decent on the board, at least at this point. But tell the kids or the OGs, I'll tell you who's a big listener to this, Henry, that I think we can inspire a 47 year old, very successful corporate player who she or he feels they're ready, they're ready. And because they've been successful for 25 years in that environment are gonna actually have like a real board and real investors. Right. Talk me through your perspective. But more importantly, I was gonna say equally, but I'll actually say more important. Cause and through the eyes of many of the founders you've been around over the last 15 years, the watch outs and the ways to best use a board. Let's do that.
- [14:48]
B
Yeah. So I have two tips on this that have worked well for me. So one is, you know, the boards are always hungry for information. They want to know what's going on, you know, et cetera. And one of my favorite lines from the Ben Horowitz book is, you know, apply pressure. Either feel pressure or apply pressure. And I think he's really talking about executive teams. When the exec teams are hounding the CEO and the CEOs like, oh, my God, I don't know what to do. Everyone's on me. I feel so much pressure. He's like, turn the tables. Apply pressure or feel it. I think that's true with the board. And so I used to tell the board, hey, I want to put you to work. And we had what's called an adopt a business unit program, where I'd have the board, each board member would pick a business unit. So I'd have Matt work on cap tables, and I have Mike work with the liquidity team. And they'd meet with the team once or twice a month. And it was great because one, they helped me. They helped scale me in terms of the strategy and sort of influencing the organization. I could run a flatter organization that way. And two, when. When the board meetings came up, they all had firsthand data. It wasn't just me trying to explain everything. Like, everybody kind of had data. So when they're like, henry, what's going on with the liquidity business? I'd be like, mike, what's going on with liquidity business? You know, and so. So it really brought them. Brought them in. The second thing I would say is the goal that, you know, the number one rule on. On boards is don't surprise them. Like, that's just it. Like, as long as you never surprise the board, you'll. You'll be okay. And so that takes a lot of.
- [16:13]
A
That is the classic mistake that very entrepreneurial. Someone like me who would be like, I'll figure it, like, never had a board before. Like, I. And I. I really don't have board life the way, because I knew that this would be a huge mistake of mine. And ironically, I'm on boards and I help the Gary in that situation. I see the CEOs doing the mistake I would make and I make it safe for her or him. Be like, hey, I know what you're doing, it's okay because I don't want to be a hypocrite. I do this shit all the time. You're being over optimistic and you don't want to scare us, so you're trying to do something. But let me give you the preview. We're going to see you in 90 days and you're going to, you're going to be on the other side of this. So you're going to have to admit to the problem and everyone at this table besides me because I'm ridiculous. But the rest of the people here are much more straight and they're going to be pissed. So why don't you just tell us that shit's fucked up now and let us help you for the next 40 minutes instead of saying it's all good. Because to your point, and this was, I'm glad you went there because I really want to give you the. I'm on the podcast all the time. I can put out content to these people all the time. I want them to hear different voices. This, let me hold it in and maybe I'll make it work by the time I see them in 90 days. When you see them in 90 days and it's double bad, aka you didn't say shit 90 days ago and now you're saying it's an 11 out of 10 issue. Whereas 90 days ago you were saying it's all fine, aka it's a 0 or a 1 or 2 out of 10, you're in deep shit because you've lost trust of the board and that's when the seeds start to sprout of are you the right person to run this company? And if you have a board that has say and you being AKA you didn't structure in a way where you could actually get ousted, you better be real careful. AKA forget about over promise, under deliver, under, under, under promise to your board.
- [17:59]
B
And over deliver, yes, 100% and totally with you, Gary. I'll even raise you one, which is like, even if it's like, you know, you're previewing bad news whenever anything you know is like, I think is going to be a little controversial or you know, people will have different opinions on or anything I do, I do what I call the rounds, which is like I text, I call all the board members one on one and I say, hey, you know, I want to give you a heads up at the board meeting, I'm going to bring up, you know, such and such, and I wanted to get your, you know, I want to preview this with you before, you know, it's a group setting so you can tell me what you think, you know, blah, blah, blah. And, and it makes them feel special, it makes them feel connected. You know, they can tell you things that they may not want to say in front of seven other board members, you know, et cetera. And it's incredible amount of work, like, you know, to call seven people, eight people and have the same conversation, you know, to, to, to do that. But it's that work that instills the trust so that by the time the actual board meetings happen, everybody already knows what's going on.
- [18:58]
A
It's. It's been, it's been quote, unquote, sold before you even had the meeting.
- [19:03]
B
Totally. And, and I like when my board members zone out in board meetings and like, they're bored and they're like, we've seen this. Like, I actually, people, my exec teams always like, come out of these board meetings, go, I don't. They, Henry, were they interested? Do they, you know, do they care.
- [19:19]
A
You know, like that.
- [19:20]
B
That I'm like, oh my God, I'm. I'm managing the board so well. When they're like, enough, we get it already. Like, like that means I've overdone it. I've over communicated everything. There's no surprises. Like, yeah, when the board is literally bored.
- [19:35]
A
Like, I've done my job well, by the way. Get your board. Board is like a book on managing the board. It's definitely a real blog post. Henry, what's the biggest mistake you made in 13, 14, 15, 16 as a leader that you're better at? I talk a lot about me being better at candor. I used to struggle with delivering bad news because I have a disease. It's called I love my employees and I mean it. I love people. You're getting to know me a little bit here. Like, I'm just who I am. Like, I really like people and I screw up and I've gotten way better. And especially last three years. I wrote a book that touched on it aggressively. I talk about in my content more. Candor was my kryptonite. If I asked you 2013, 14, 15, Henry. Versus 2022, three going into 2024. Henry, what's been the biggest gap you've closed as a leader?
- [20:25]
B
Yeah, well, I have two thoughts. One on the, on the candor side. I'VE always had a problem with the kind of the candor. Candor. Radical candor thing. I remember talking to Candy Kim about it and you know, I love Kim. I think he's fantastic. But I always said, you know, the problem I have with the book is it's a, it's a one size fits all. Like, radical Candor kind of works with no matter who you're talking to, you know, whether you're talking to a shy, you know, 23 year old first job employee or like your 25 year veteran CFO that you've worked with for six years. Right. Like it's, it's the same. And everything I know about people is know your audience, like how you talk to them. Yeah, yeah. Matters.
- [21:03]
A
That's what to your point, Kim's awesome. Like, by the way, I call it kind candor at VaynerMedia because I think radical people feel like, oh, let me give you the purest form of it, which I actually think seeps into people's real struggle with candor, which is they don't, they don't deliberate with enough empathy, compassion, sympathy and context.
- [21:25]
B
Totally. I would even go, so here's the. I do this all the time in my management training, right? You go, okay, so the manager's working with their employee and the employee's not doing great, in the manager's view. And the manager says, okay, you know, so I'm going to deliver the feedback. And they basically say, you know, employee, you know, I don't think you're doing great. And, you know, I always ask, you know, the most important thing to figure out is it doesn't matter yet what you think. What matters is what the employee thinks, right? If the employee agrees with you and is like, I don't think I'm doing great either. That's a very different conversation than that. If the employee's like, I don't know what you're talking about. I'm crushing it. And so the first thing to say after you say, hey, I don't think you're doing great is what do you think? Right? And if they're like, I don't think I'm doing great either, you're like, amazing. So let's talk about how I can help, right? That becomes a collaborative discussion of fixing it. If the employee's like, I'm crushing it. I don't know what you're talking about, that's a very different conversation. Right? And then the second, if you go down the decision tree, the second thing managers always do is I say, okay, what do you say, if they say manager, you're wrong, I'm crushing it. I don't know what you're talking about. The manager will always. What they do is they double down. They're like, no, no, here, here's all the reasons why you're not doing good. Right? And I'm always like, that's the losing battle. Never do that. Right. And my advice is always to say to the employee, I say, oh, amazing. I'm so glad you think you're doing well. Why do you think I don't think you're doing well? So you lead with curiosity because that's the thing to figure out, right? The question to solve is not if the employee is doing well or not. The question to solve is, why are you seeing the same thing differently? That's the question to solve.
- [23:11]
A
I love you for that. Because we do something here where I train my leaders to say, hey, Henry, in my subjective opinion from my purview, which is all I can really rely on, and the data that I've gathered from others, I believe you're not crushing it. Instead of like, this is definitive fact. And that really triggers people because we know this. A lot of managers are wrong. A lot of times you're right a lot of times. By the way, I watched managers for years give feedback to people only because they wanted to keep them down, because they knew that person was better than them.
- [23:46]
B
Totally 100% idiosyncratic. Manager bias, I think, is one of the worst diseases in an organization.
- [23:53]
A
I couldn't agree more, brother. Real quick, just almost like we interrupt for this commercial break. I really do love your product. And so one more time, who, who's listening here should really discover Carta and why and what does it do and where should they go?
- [24:11]
B
Oh, thanks for letting me do this.
- [24:12]
A
Yeah, I really. You know what, people? I've done this podcast a long time. I never do this, but I wanted to do this for two reasons. I wanted a steak and potatoes meeting, which we're doing. And honestly, I really think I'm about to help a lot of people who listen to this show. So I'm being a little selfish and I'm thrilled that it's good for you.
- [24:30]
B
Yeah. Thank you. So, you know, we serve two types of customers. So one is if you're an entrepreneur running a company, whether it's, you know, a two person startup, whether it's an llc, you know, small business in the Midwest, like, we have products for you. Basically, we want to help you manage your shareholders, your stakeholders, your employees. So we'll help you on understanding the capital structure of your business. That's what we do for entrepreneurs. And then on the other side, if you're a venture fund manager or a private equity fund manager, we'll help you manage your fund. And like, Gary, you're a customer of ours, you know, for your venture fund. And we help people like you. You know, I have this kind of view of the world, which is, you know, America as a country, we're like, great at producing accountants, you know, and lawyers and doctors. Like, we're really good at that. But we're really bad at producing entrepreneurs. Like, we just don't.
- [25:26]
A
Yeah, we don't do that well. We don't produce them. What happens to them? I'm going to show you something, Henry, that is appalling. This is my report card. Look at my class rank.
- [25:37]
B
It looks like mine. Yeah.
- [25:40]
A
You and I have started a company from scratch with 2,000 employees, knock on wood, are doing extremely well. I mean, I was literally the 11th worst student in my class. You're absolutely right. We. Now, look, I actually would argue a different point. I actually think America is great at creating entrepreneurs, which is why it creates entrepreneurs in the macro, in the micro, AKA school system, and like a lot of social norms. We have the inspiration for entrepreneurship here. We put it on a pedestal. There's plenty. I was born in a place where we demonized it. It was called the ussr. I was born in the Soviet Union, you know, and so I think that. But to your point, we definitely don't teach it. You're either born with it and you fight the system. The one that really bothers me, which I think is what you're touching on, you're born with it and the system and your parents take you out of it, which is the devastating one. Some of the greatest entrepreneurs were talked out of it to be lawyers, you know, and doctors. That crushes me. So I love where you're going with that. So go ahead.
- [26:41]
B
Well, to your point, yeah. You know, entrepreneurs in America, you know, we're celebrated, but we're the aberration, right? We're the weird ones. To your point, your report card shows it, right? You're the exception, not. Not the rule. And that's why I say, like, it's a weird thing. And it just goes from, like, the way, the way we. We teach school, right? School is taught. You go kindergarten, first grade, second guard, you know, 11th grade, you know, freshman in college, and then you become a junior associate and then a senior associate. And it just. There's a Ladder in entrepreneurship there's no ladder. It even goes to the way we do school tests. It's so weird tests. You start at 100%, it's bounded and then everything you get wrong, you get dinged and you go down as opposed to you start at zero and then everything you get right you go up and it's unbounded because that's what entrepreneurship is. You start at zero and you go up and it's unbounded. But that's everything we're taught in school is the opposite.
- [27:40]
A
What have you noticed? Here's a good one. A lot of people for that. You have 2,000 employees. I have 2,000 employees. What does a middle manager call it? A director wanting to be a vp. Everybody's got different terminology but like what does a middle manager in your company do to take it to the next level? You can be very specific of how it works at Carta and how do you feel that maps to advice that I think we have a ton of middle managers, great, you know, six figure salary, doing their thing, but really do want to grow. And from a CEO's point of view, from a real entrepreneur and been around the kind of tech companies that are really, there's a lot of companies that fit the profile of what you do and a lot of them are coming and are being built now and just. And even a lot of them had to be at this point of the size of your, my company and that was 30, 40 years ago. But middle manager, what are some of the things you're seeing that help somebody propel to a VP or SVP or EVP or take those next two steps? Double their salary, more responsibility, more challenges, enjoy their day to day more. What are some of the cliche things you think about when you're trying to help a middle manager grow?
- [28:52]
B
Yeah, When I was 18, I enlisted in the Marines and I went through kind of officer candidate school in college and all that. And somebody said to me, he goes, you know, the difference between military life and civilian life is in the military you're judged by the worst thing you did and in the civilian life you're judged by the best thing you did. And in most companies middle managers are judged by the worst thing they did. Your job is to not mess up right and to like do the right thing and be popular and liked and all that kind of stuff and not piss off your boss and you know, not have any dings and, and that leads to a very defensive, you know, middle management core and, and really a calcification of an Organization, I hope. At Carta, we're a company where we measure middle managers on the best thing, the best things they've done. And so if, if that's true, that really means like, we forgive mistakes, we don't care about that kind of stuff. What we really want to see is a middle manager bend the arc of Carta, right? Like a middle manager, just like they may, may do six things that don't work out, but boy, that seventh thing that they did, wow, right? Like that gets on my radar. Like, I'm like, who, who was that person that was in that meeting? What did they just do? Bring that person back to my office? I want to hear more about it. 100 and, and, and, but that's really hard. It's really hard.
- [30:17]
A
And it's hard for them not to fear the ramifications of shining. Most middle managers are scared to shine because they know when they leave it becomes political and their boss, vp, whatever, are like, what the fuck was that?
- [30:30]
B
That's right.
- [30:31]
A
And they think, they think that person can get them out before you and I can get them up.
- [30:37]
B
That's right. It's threatening, right? Because their boss is like one. If my middleman, if my manager, you know, that works for me, makes a mistake that's a reflection on me, so I'm gonna punish that. And then if they actually do something amazing, right, what does that make me look like? Like they're better than I am. And so, so that's why middle management is such a, like an, I would almost describe it. It's like the oppressed, you know, middle class of, of organizations. And creating a dynamic middle management core, I think is one of the biggest challenges of running a growing organization.
- [31:12]
A
I couldn't agree more. What have we not touched on in the last seven or eight minutes.
- [31:21]
B
You know, on the scale and operational side? You're sort of talking about what I would have done differently, you know, and how things are different from like the first five years versus the second five years of this company. And I would say, you know, the job changes quite a bit for the CEOs that are out there that are thinking about early stage versus versus late stage. And you know, there's this kind of inflection point where I used to be able to keep the whole company in my head. Like I used to know the whole business in my head. Like I knew everything that was happening. And then this becomes this inflection point where I feel like I don't know anything that's happening. It's like, you know, I also Describe it as. You know, when I talk to early stage founders, nothing happens unless you make it happen. Right? That's, that's what it means. To be an early stage founder is like you. You are the catalyst. You. You create the energy of the organization and then you get to, you know, the scale you're at, Gary, and like things just start happening and you're like, why are these things happening? Right? Like, like, I don't want things to happen and they happen.
- [32:24]
A
Let me ask you a question. This is a good one because for the hundred people in the next year and the thousands over the years that listen to this, for the 2000 plus employees like you and I, I'm going to ask you a question. How many, not just your direct report, the C suite, how many family members do you have in the 2000 that are your eyes and ears? They might be a director, they might be in ops, they might be in hr. I just want. I'm curious what your answer is when I say family members. You know exactly what I'm saying. The fucking homies. The one that eyes and ears, the, the double agents, like the ones that are really helping you mitigate or get clarity on all this shit. To your point, I think we're opening an office. I didn't know about that. I'm like beside myself. About. From a meeting this morning. Dead serious. A physical office. How many of those do you have of 2,000 right now? Go.
- [33:22]
B
Yeah, probably two dozen. Yeah, I should have more and.
- [33:27]
A
But not a bad number. Not a bad. I would, I would say two dozen. 24, I would say. I would say I have 40. And I would like another 12 as well. And. But I got. I have a company that started with a bunch of kids that have worked here their whole life. We're only 14 years old, similar to you and a little bit older. And I think, you know, actually. So you're what, 10 years old now?
- [33:50]
B
Yep.
- [33:51]
A
How many people have worked there for eight years or more?
- [33:56]
B
Less than 15.
- [33:57]
A
Got it. We got a little bit luckier. And I make sense. Equity. You had different things that probably triggered that. We got really lucky with our 11 plus of that 14 year run. There's enough that allows me to have more of them anyway. Not to lose the final minutes here. Everyone who's listening, make as many family members as you can if you plan on growing big big. But remember, to be a family member that requires you putting in the work for them to take you in as family to be able to have what we're both talking about, which is Very needed at scale.
- [34:29]
B
Yes, totally. And so knowing, like, I just have, you know, someone that, you know, is in, is in London and I'm going to London next week, you know, to kind of visit the office. And you know, I have my person there and I called, called her and I'm like, hey, tell me what's really going on over there. You know, I get the reports, I get it through the chain of command, but like, tell me on the ground, like, what's, what's really happening? And it's like super, super powerful. And having those people is super important. There's also this kind of, you know, you know this because you're the founder CEO as well as I am. There's this big difference. I talk to executives about this all the time. You know, what's the difference between working for a founder CEO versus a professional CEO night? Yeah, yeah, hold on.
- [35:14]
A
I apologize to be inappropriate like this. There's nothing is a bigger change in the history of an organization that's destined to be big than the day the founder CEO, she or he leaves. Nothing is a bigger day. That's how different it is in the history of the company. Public ipa. Nothing.
- [35:37]
B
Totally. It's a completely different culture dynamic, you know, and just the way that you work, like, we've had terrible success bringing executives in that have never worked for a founder CEO before. And then they work for me and they just think I'm a maniac. Understandably, like, compared to every CEO that they work for, they're like, Henry is just. Is impossible. Like, how do I work with this guy? And then you, you work with, you know, executives that have worked with founder CEOs and they're like, okay, Henry's just a, he's just a normal founder CEO. Like, that's how. That's how these people roll. It's such a different, different framework.
- [36:15]
A
Party shots, my friend. What, what things of business or carta or startup or pop. You want to talk about Travis Kelsey and Taylor Swift, you know, like every other fricking human on earth. By the way, there's no more cliche New York jets thing, my real passion, my true love, than the. At the height of this Taylor Swift Kelce thing. The jets are playing on Sunday night national football, the most watched game, not even Monday night anymore. Sunday night Taylor Swift's going to be in the building. 10 million people that have never watched a football game are going to watch because of all this hype. And the jets are at the low, low point, maybe their franchise with the hype of Aaron Rodgers and the Achilles and we're not playing well, this is the most jets game ever. Anyway, two minutes on anything. You know, actually, let me say it this way. You were thinking about this podcast, what did we not touch on that you either wanted to touch on or thought we might touch on.
- [37:13]
B
You know what I'm excited about talking with you, Gary, is I do a lot of podcasts, you know, in my industry, you know, we do, you know, we're talking venture and so on. And you know, one of the things I spend a lot of time talking about, we call it crate ownership. Right. I have this kind of view of the world that, you know, labor used to be serfdom, where you were sort of, you know, you know, you were legally free but economically indentured. I think we're in the era of payroll today where people sell time for money. And I think the future of labor is really going to be an ownership era. And I think, you know, the future is here. It's just not evenly distributed. And we see it in tech and you're starting to see it in other industries, you know, and entertainment and sports, you know, the PLL Professional Lacrosse League gives equity to players. You're starting to see it in other, you know, the NBA's starting to think about it, you're seeing in other industries. And so one of the things that, you know, I'm excited as you have a broader audience outside of tech is, you know, can we start catalyzing more companies thinking about ownership and employee ownership as a way of compensation so that the next era of labor will be an ownership one?
- [38:23]
A
I think that's right, brother. Especially if you nerd out on the blockchain and what that technology will enable and really understand not the speculation of the NFT market or the hype of the cryptocurrencies, like if you really understand what the blockchain will do for the thesis you have, it is the underlining technology enabler of. Of that guaranteed truth 100%.
- [38:45]
B
Yeah.
- [38:46]
A
I enjoy this, my friend. Great job.
- [38:49]
B
Gary. Thanks so much. So much fun. Thank you.
- [38:51]
A
One more time, where should everybody go to check out your company, which I think a lot of people should be using.
- [38:55]
B
Karta.com c a r t a dot com. Thank you.
- [38:59]
A
And everybody, you know this. I don't go for the hard push. And you can see he wasn't looking for the push. I was looking for him to push. I think a lot of you need this. Cause, you know, in the same way I'm pushing you to make 30 minute meetings, 15 we didn't get to this one hour meetings being 30 minute meetings.
- [39:14]
B
Not.
- [39:14]
A
We don't need 21 people in this meeting. We need 13. Everyone's like, oh, I'm stretched. I'm like, what about managing your time? And so, same here. This, to me, is a saver of time versus the way you're doing it and doing it better. So, anyway, congrats. I've been very impressed for a long time from afar, Henry. And I'm thrilled we stumbled on each other. I'm thrilled you took the invite to be on the show, and I love this time together.